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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › depreciation
Hi John
I am stuck at this question
How will we calculate the gain/loss on scrapping
Outflow scrapped numerous items of plant and equipment during the year. The items scrapped were originally purchased for $7000,000 and they had a carrying amount of $1000,000 at the date of siposal. The gain or loss is included in the cost of sales.
THey havent given the proceeds, THey have only given-
Cost of sales- 33560
Plant and equipment 2001- 245000 , Acc dep 145,000
Plant and equipment 2002 – 260,000 , Acc dep 150,000
You cannot calculate a gain or loss without knowing what the sales proceeds (if any) were.
Surely the book you found the question in gives an answer together with workings?